Accrued-to-Date - account balance

[John Feldt ERPA CPC QPA]

If the accrued-to-date testing option is used, the "account balance" is tested: 1.401(a)(4)-8(b)(2). This worked very for this one plan since the plan was not cross-tested for the last 15 years (until last year). The target HCE is only 4 years older than the plan's one NHCE.

This year, the spouse shows up on the census with low compendation and they want to know if the spouse should defer.

I read 1.401(a)(4)-8(b)(2) to be the entire balance, not just the employer-provided nonelective. A high spouse deferral would not test well. Is it possible that the entire balance is used only for the average benefits testing and that just the employer-provided nonelective balance is used for the rate group testing if tested using the accrued-to-date method?

I don't see it that way, but wanted to throw up the question. We'll test another way, suggest low spouse deferrals, or imply that higher spouse wages might help out. Any other ideas?

Edit: After reviewing, I am instead convinced that the deferral and match balances are not part of the rate group testing when testing the nonelective. My misunderstanding there.